Posted by Mike Sandmel
A lot has been written about the shortcomings of New York’s recently-passed state budget. The upshot: New York’s electeds missed the clear opportunity to take decisive action against Trumpism and to protect communities under attack.
A glaring example of this failure of leadership is the decision, yet again, not to fund a widely-supported program that invests in low-income communities and communities of color: the state’s Community Development Financial Institutions (CDFI) Fund.
The need for state-level action on CDFIs couldn’t be clearer. The Trump administration, rapidly dismantling federal support for community development, has put CDFI funding on the chopping block.
Supporting CDFIs in New York should be a no-brainer, and yet the statewide fund has sat empty since the legislature created it in 2007. CDFIs are mission-driven community development credit unions, loan funds and banks that serve low-income communities and communities of color. They’re enormously effective and efficient, leveraging every public dollar they receive with 12 additional dollars from other sources.
Funding New York’s network of CDFIs also has enormous, and growing, public support. Earlier this year, a broad-based coalition organized around the NYS Community Equity Agenda, sent an urgent letter to State Senate and Assembly leadership calling on the State to allocate $25 million for CDFIs in this year’s budget. Thirty New York State Assemblymembers sent a similar letter to Assembly Speaker Carl Heastie, stating that “CDFIs represent a future of equitable, fair, and accessible services for our low-income communities and communities of color.” The Senate Democratic Conference likewise supported the $25 million allocation to the CDFI fund in their budget priority letter.
Yet, when the backroom deal-making was over, all that made it into the final $168 billion budget was a scant $400,000 — the equivalent of a rounding error — for a revolving loan fund far too small to make any measurable impact on CDFIs’ capacity to serve low-income New Yorkers and communities. Of course, meaningful state funding for CDFIs is just one piece of a broader vision. New York must ensure economic justice and self-determination for all of its communities.
New Economy Project and dozens of ally groups will continue to press for the New York State Community Equity Agenda, which offers concrete strategies for transformational economic policy statewide. The good news is that the coalition behind the Community Equity Agenda is strong, growing, and ready to take action.